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ECON 20B- Final Exam Guide - Comprehensive Notes for the exam ( 43 pages long!)


Department
Economics
Course Code
ECON 20B
Professor
William Branch
Study Guide
Final

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UC-Irvine
ECON 20B
FINAL EXAM
STUDY GUIDE

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Measuring and Explaining Long-run
Unemployment
Lecture # 5
William A. Branch
Outline
Contents
1 Sec. 1 1
2 Measuring Unemployment 1
3 Explaining Long-run Unemployment 2
1
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1 Overview
Main idea:
In the theory of long-run growth:
Y=AF(L,K,H,N)
Assumes that Lconsists of entire work-force.
In reality, some workers don’t have work even though they would like to, i.e.
there’s unemployment.
Lower the amount of unemployment makes resources more efficient, im-
proves standard of living.
2 Measuring Unemployment
Measuring Unemployment
Bureau of Labor Statistics (BLS) conducts Current Population Survey (CPS)
of 60,000 individuals.
Survey puts each into 1 of 3 bins:
employed: includes self-employed, family business, part-time, vacation
or temporarily not working.
unemployed: not working who looked in previous 4 weeks.
not in labor force: everyone else includes student, retiree, homemaker,
discouraged worker.
Measuring Unemployment
Definition 1. Labor force=total # of workers = # employed + #unemployed
Definition 2. unemployment rate=#unemployed
labor force ×100
Definition 3. Labor force participation rate =Labor force
Adult Population ×100.
2
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